Cambridge Environmental Updates Corporate Activity.

CALGARY, Alberta--(BUSINESS WIRE)--Sept. 11, 1995--CAMBRIDGE ENVIRONMENTA (VSE: CVY OTC NASDAQ: CNVSF) CAMBRIDGE ENVIRONMENTAL SYSTEMS INC. reports, at the request of the Vancouver Stock Exchange, as follows:

On July 3, 1995, trading in the securities of Cambridge Environmental Systems Inc. was suspended by the VSE pending the clarification of Cambridge's affairs. The suspension resulted from concerns of the VSE arising out of review of materials filed by Cambridge, including the audited financial statements for June 30, 1994, and certain agreements entered into by Cambridge with Jamie Wheeler and Ryckman Financial Corporation. The VSE has provided Cambridge with several pieces of correspondence outlining its concerns, which focus on the following areas.

1. AGREEMENTS BETWEEN CAMBRIDGE AND RYCKMAN FINANCIAL CORPORATION

A total of four agreements were entered into between Cambridge and Ryckman Financial Corporation. These agreements were not previously filed for acceptance with the VSE.

Two of them were agreements for the provision of management services. Pursuant to these agreements, RFC arranged private placement financing, liaised with investors and provided advice to Cambridge's President and CEO. For these services, RFC received a fee of $5,000 per month. Each of the management agreements was for a term of one year. The last management agreement expired on June 30 of this year. It was not renewed.

The other two agreements with Ryckman Financial Corporation were agreements to provide office space, office services, legal and accounting services and general office supplies and services. For these services, Ryckman Financial services received a fee of $10,000 per month. The last of these agreements also expired on June 30 of this year and has not been renewed.

2. INVESTOR RELATIONS AGREEMENT WITH JAMIE WHEELER

Jamie Wheeler of Calgary, Alberta was employed by Cambridge as a corporate security and corporate finance adviser under an agreement between Wheeler and Cambridge, with a one-year term which expired on September 30, 1993. That agreement was not renewed. This agreement was not previously filed for acceptance with the VSE. Under that agreement, Wheeler was paid $100 per month and was granted options to purchase 230,000 shares of Cambridge at $0.61 per share.

3. SHARE ISSUANCES

The VSE expressed concern about the sum of $239,110 expressed in Note 13a to Cambridge's 1994 audited financial statements as being owed to Cambridge by a related company providing management services. That party was Ryckman Financial Corporation.

The note refers to certain agreements among Messrs. Jamie Wheeler and Richard Shillington, Cambridge and RFC relating to the exercise of warrants by Wheeler and Shillington.

In December and January of 1994, Mr. Wheeler exercised 54,284 warrants to purchase common shares of Cambridge at $0.42, for a total exercise price of $22,798.28, and Mr. Shillington exercised 444,444 such warrants at $0.50 for a total exercise price of $222,222. The warrants had been issued under private placements previously approved by the VSE. It was agreed among the parties that, of the total exercise price for the Wheeler and Shillington warrants of $245,021.28, $196,110.40 would be set off against amounts owing to RFC under the four agreements between RFC and Cambridge referred to above.

Four thousand one hundred seventy-five dollars in other payables which had been paid on behalf of Cambridge by RFC were also set off. Forty-three thousand dollars was paid in cash by RFC and $799.88 was paid in cash by Mr. Wheeler. The shares were issued to Messrs. Wheeler and Shillington. These offsets were found unacceptable by the VSE in view of the fact that the investor relations agreement with Mr. Wheeler and the four agreements with RFC had never been accepted by the VSE.

4. LEGAL ACTIONS

The VSE requested particulars concerning certain actions commenced against Cambridge and its operating subsidiary Skimmer Oil Separators Limited. Those of the actions which are material are as follows:

1. An action has been brought against Skimmer claiming $244,802 for services rendered as payment. Minutes of Settlement providing for the payment to the Plaintiff by Skimmer of approximately $20,000 per month from February 28, 1995 to February 28, 1996 have been entered into. Skimmer has failed to make two monthly payments. Discussions with the Plaintiff concerning this matter are ongoing.

2. Vortex Oilfield Systems Inc. has brought an action against Skimmer and Cambridge claiming $130,962 and interest at the rate of 2 percent per month. Vortex alleges this amount is due in respect of labour and materials supplied to the oil treatment plant operated by Skimmer at Marwayne, Alberta. Skimmer and Cambridge are defending the action and have counter-claimed against Vortex for $750,000. Cambridge and Skimmer's position is that the equipment and services provided by Vortex were inadequate and that Vortex failed in several attempts to correct the situation, resulting in excessive costs and lost production to Skimmer.

3. Smith, Lyons, Stevenson, Torrance & Mayer has brought an action against Cambridge and two other companies in which that law firm claims against Cambridge $94,259.36 in respect of legal services. Cambridge is defending the action and is counter-claiming. Cambridge's position is that the legal services were performed negligently.

All of the directors of Cambridge have submitted Statutory Declarations confirming they have read, understood and will comply with Cambridge's listing agreement with the VSE and VSE policies. Management of Cambridge has also agreed to certain conditions imposed by the VSE to ensure Cambridge operates with the rules and policies of the VSE and the Securities Act (British Columbia).

CONTACT: Frank W. King, President and CEO, 403/269-2492 REPEATS: New York 212-575-8822 or 800-221-2462; Boston 617-330-5311 or

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